📍Coinbase missed expectations in Q1, the downtrend has caused the company to incur heavy losses

📌Coinbase reports Q1/2026 worse than expected as the crypto market experiences high volatility, leading to weakened spot trading activities.
📌 Total revenue only reached $1.40B (forecast around $1.49B-$1.56B).
Trading revenue reached $755.8M, below the expected $805.2M and sharply down compared to the same period -> This remains Coinbase's core business, so when spot volume declines, the entire report immediately worsens.
📌 Subscription & services revenue reached $583.5M, also below the forecast of $619.3M.
The bright spot is in stablecoins, with revenue around $305.4M (+11% YoY).
-> Subscription & services currently account for over 40% of revenue structure, as Coinbase is trying to reduce dependence on trading fees.
📌 EPS reached -$1.49, far below the profit expectations.
This is the most negative point impacting market expectations. Immediately, $COIN dropped about -5%, then recovered to only -0.28%.
📌 The brightest point is Coinbase has expanded its market share of crypto trading volume to 8.6% - also the highest ever.
Derivative volume TTM increased +169% YoY.
Prediction markets reached over $100M ARR in less than 2 months.
📌 Business outlook for Q2 remains poor
- Forecasted subscription & services revenue of $565M-$645M, with a midpoint around $605M, lower than previous quarters.
- As of now, trading revenue in the new quarter is only about $215M, and with the market still weak, a surge is unlikely.
- Coinbase also plans to spend $925M-$975M on technology, development, and G&A costs, with sales & marketing at $215M-$315M.
- The company will burn $50M-$60M restructuring costs due to cutting about 700 employees (14% of the entire company) to replace with AI.
-> Although $COIN does not decrease significantly after the earnings report, it remains unfavorable for upcoming quarters as the overall market trading volume decline shows no signs of improvement.